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Ferronordic shares surge 60% as sells Russian business for $126 mln


OSLO, Dec 23 (Reuters) – Sweden’s Ferronordic, which sells and services construction equipment and trucks, said on Friday it had divested its Russian business in a deal worth 1.32 billion Swedish crowns ($126.08 million).

Ferronordic’s shares, which collapsed after Russia’s February invasion of Ukraine, rose more than 60% by 0915 GMT, hitting a nine-month high of 83.5 crowns.

The buyer is part of the GILK group, a Russian leasing company, Ferronordic said in a regulatory statement.

“Despite extreme circumstances, we have managed to sell the Russian business at a price on par with the sold companies’ net asset value,” Chief Executive Lars Corneliusson said.

“We now look optimistically into 2023 and beyond,” he added.

Ferronordic spent approximately 230 million crowns on repaying debt to the sold Russian subsidiaries, while the remaining cash was deposited in euros into the group’s account in Austria, giving it a cash inflow equivalent to 1.09 billion crowns.

“Ferronordic’s other operations in Germany and Kazakhstan are not directly affected by the transaction,” the company said.

The sale means that Ferronordic has divested its assets and liabilities relating to Russia, although the company will maintain one subsidiary there to keep a small number of employees working for the group.

“The intention is that these employees will relocate to other markets over time,” it said. ($1 = 10.4698 Swedish crowns).

Source: Reuters